How is Cash Flow different from Free Cash Flow (FCF)?

4 years ago
Financial Management

Free cash flows (FCF) refers to the remaining cash available for investors after considering cash operating and investing expenditure and it is used to find a business’s current value. However, cash flow is used to find net cash inflow from the business’s basic activities like operating, investing, and financing. 

Free cash flow helps in defining business valuation which is required by investors as it includes capital expenditure and changes in Net Working Capital

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Sanisha Maharjan
Sanisha Maharjan
Jan 18, 2022
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